Ark Invest updates Spot Bitcoin ETF prospectus; ETF specialist anticipates more delays
- ETF specialist Eric Balchunas has indicated that Cathie Wood’s Ark Invest filed an updated version of its Spot BTC ETF.
- Among the changes, the firm articulates that the trust’s assets are not commingled with corporate or other customer assets.
- Balchunas anticipates more back and forths with SEC on certain small but important details, hence more delays.
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Ark Invest, the renowned American investment management firm associated with Cathie Wood, has updated its Spot Bitcoin exchange-traded fund (ETF) filing after a recent feedback from the US Securities and Exchange Commission (SEC). It comes as several issuers continue to await the financial regulator’s decision.
Also Read: Former BlackRock director estimates Bitcoin spot ETF to be approved by April 2024
Ark Invest edits and updates Spot ETF filing
Ark Invest asset management firm has improved its Spot BTC ETF prospectus, weeks after the commission emailed issuers with comments and questions regarding their forms S-1. In the email, the financial regulator had details that they wanted addressed. According to ETF specialist Eric Balchunas, it is highly likely that the firm has answered all the commission’s concerns in its latest submission.
ARK has just filed an updated version of its spot bitcoin ETF prospectus. The SEC emailed issuers a few wks ago with comments/qs about their S-1 that they wanted addressed so is very poss ARK has answered all that in this filing. We looking thru it now.. pic.twitter.com/AlwTt82WU0
— Eric Balchunas (@EricBalchunas) October 11, 2023
Among the changes spotted, under the Net Assets Value (NAV) Determination, the new prospectus features details on how the NAV calculation is not in accordance with GAAP accounting. The SEC had comment about this issue in its address weeks ago.
Net Asset Value Determination
Another new addition is that the filing articulates that the Trust’s assets with the Custodian are held in segregated accounts (wallets) on the Bitcoin (BTC) blockchain. With this, the assets are not commingled with corporate or other customer assets.
The subsequent pages of the form S-1 feature a lot of other material, but the new stuff is featured in different places of the first two pages. This points to ARK getting the SEC's comments dealing with them all. With the issues all responded to, it remains to the SEC to weigh whether to approve or not.
According to Balchunas, there will be a few back and forths with the SEC on small but important details about the process, which ultimately leaves the door open for more engagements before the financial regulator can finally give a green light.
Noteworthy, Ark Invest expected to receive a decision on its filing on September 26 but did not. In fact, the regulator beat the deadline by three days, giving a "notice of the designation of a longer period for commission action to determine whether to approve or disapprove a proposed rule change..."
Crypto ETF FAQs
What is an ETF?
An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.
Is Bitcoin futures ETF approved?
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.
Is Bitcoin spot ETF approved?
Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale – whose application for a Bitcoin spot ETF was initially rejected by the SEC – got a victory in court, forcing the US regulator to review its proposal again. The SEC’s loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.
Author
Lockridge Okoth
FXStreet
Lockridge is a believer in the transformative power of crypto and the blockchain industry.
